Legislature(2017 - 2018)ADAMS ROOM 519
04/18/2018 09:00 AM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB216 | |
| SB102 | |
| SB104 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 383 | TELECONFERENCED | |
| + | SB 102 | TELECONFERENCED | |
| + | SB 216 | TELECONFERENCED | |
| + | SB 104 | TELECONFERENCED | |
| + | TELECONFERENCED |
CS FOR SENATE BILL NO. 216(FIN)
"An Act relating to the calculation of state aid for
schools that consolidate; relating to the determination of
the number of schools in a district; and providing for an
effective date."
9:39:42 AM
SENATOR NATASHA VON IMHOF, SPONSOR, thanked members for
hearing the bill and the House for working on HB 406, the
companion bill. She indicated that the request was brought
forward to the legislature by several of the large urban
school districts in Alaska who were facing the challenge of
student migration out of their districts, leaving under-
utilized school buildings with excess capacity. Current
state law inadvertently discouraged school consolidation.
Analysis showed that districts that might want to
consolidate schools found that any savings experienced
through reduced labor and operating costs were
detrimentally offset through the reduced income received by
the district when students were absorbed into a larger
school.
Senator von Imhof explained that currently the school size
cost factor contained in AS 14.17.450 was an adjustment
factor applied to the base student allocation (BSA) which
gave smaller schools more money per student and larger
schools less money per student under the theory that small
schools were less efficient with higher operating costs per
student. For districts that might like to consolidate
schools, the fact that they were effectively punished via
the state funding formula for school consolidation meant
that many were unwilling to even have a conversation about
consolidation. Senate Bill 216 addressed the issue. The
bill provided a 4-year consolidation transition that
allowed a school district to gradually move from their
current state aid amount to a lower state aid amount after
the consolidation of schools. It was voluntary and simply
another tool for districts to use if they chose to. The
purpose of the bill was to encourage and incentivize
districts to look for excess capacity within their
districts through potentially consolidating schools by
holding harmless the state revenue received for 2 years
followed by a step down in revenue in years 3 and 4 so the
district had time to repurpose the asset and reabsorb the
associated operating costs. She had relayed the essence of
the bill and indicated her staff would continue with an
explanation and a review of the PowerPoint.
9:42:44 AM
JONATHAN KING, STAFF, SENATOR VON IMHOF, introduced the
PowerPoint presentation: "SB 216: School Consolidation
Transition." He was also available to walk through the
sectional analysis after the presentation if needed.
Mr. King began with the school size adjustment chart on
slide 2: "Alaska's School Size Factor Adjustment AS
14.17.450(a)." He indicated that the figure showed Alaska's
school size factor adjustment in AS 14.17.450(a). It was
part of the school funding formula used to provide smaller
schools with slightly more money than the state provided to
larger schools. He explained that for each individual
school the state counted the number of students, the
unadjusted average daily membership (ADM). For the
individual school the state located where they sat on the
curve. The curve provided the multiplier used inside the
school funding adjusted. He noted that the shape of the
curve went up on the left-hand side and went down on the
right-hand side. In terms of funding, in a smaller school
kids counted for more than kids in larger schools.
9:44:06 AM
Mr. King moved to the graph on slide 3: "Effect of the
School Size Factor on Consolidation: Example 1." The
problem the bill tried to address could be seen on the
slide. The curve followed exactly the same curve on the
prior slide. However, it showed the distribution of schools
inside the Anchorage School District. The district was
large enough to provide a large range of schools and the
same shaped curve as before. He highlighted the 2 green
dots on the page. He presumed that the 2 schools
represented by the green dots wanted to consolidate and
that the space in one of the existing facilities was large
enough to bring the kids from the other school over.
Currently, there were 2 schools; one with 755 students and
one with 798 students. Their school size factor adjustment,
according to statute, was equal to 1.06 and 1.05 - the
multipliers that their ADM received in the state funding
formula prior to consolidation. In combining the two
schools, they became the red dot further to the right of
the curve marked by the numbers 0.95 (the new multiplier)
and 1553 (the new number of students). Before
consolidation, the 2 schools would have received $11.8
million in state aid. After consolidation with the drop
down to the curve to the right, they received $10.6 million
in state aid. There was a difference of $1.2 million. At
the same time, they ended up with a drop in local funding
because the maximum amount of funding a school could
receive was a function of the total basic need calculation
for the state. The schools lost an additional $250,000 in
local funding. The hurdle for the school district was
whether it would save more than $1.5 million. The funding
the school would receive from state and local sources by
combining the 2 schools was $1.5 million. The question was
whether the school would save $1.5 million. If not, there
would be a net loss to the school district. He suggested
that when school districts did the calculations, they found
that their drop in funding was greater than their estimated
savings, at least in the short run.
9:47:03 AM
Mr. King continued to slide 4: "What the Bill Does: Section
1." He relayed that Section 1 removed the disincentive by
providing a 4-year transition period for consolidating
schools. In years 1 and 2, the school would preserve 100
percent of the pre-consolidation per student funding. In
the prior example where the two schools were combined, for
the first 2 years after consolidation their school size
adjustment factor would be held stable at 1.06 and 1.05 on
the prior slide. In year 3, the consolidated schools would
start transitioning to the post-consolidation funding
amount. They would receive the post consolidation amount
plus 66 percent of the difference between pre and post
consolidation. In year 4 they would receive 33 percent of
the difference plus the base amount. After year 4 the
school would receive standard funding as provided for in AS
14.17.410.
Mr. King reviewed slide 5: "What the Bill Does Not Do:
Section 1." The bill did not change the school size funding
formula in AS 14.17.450. The curve would not be affected
and would not change anything for those schools that did
not consolidate. For example, if Fairbanks had a
consolidation and Mat-Su did not, there would be no funding
effect to Mat-Su. It would only affect Fairbanks. Even
within Fairbanks, it would only affect the portion of
funding that was associated with the schools involved in
the consolidation. The calculations associated with schools
that were untouched by consolidation and did not have
boundary issues would not be included. The legislation did
not encourage districts to build new schools for the
purposes of consolidating existing schools. He noted there
was a prohibition within SB 216 to use a new facility. An
existing facility had to be used. It did not allow schools
to reopen or reconsolidate in order to take inappropriate
advantage of the consolidation transition. In other words,
there were limits on going back and forth. One thing heard
in public testimony was that there was no better way for
the school districts to get more money than by staying at
the status quo. Under the status quo, school districts had
the incentive to have the smallest schools possible because
they received the most funding associated with the curve.
The goal was to move away from the status quo, change the
thinking about the status quo, and make consolidation
potentially more attractive. The tool was available to
school districts who wanted to use it.
Senator von Imhof added that in Section 1 the bill was not
costing the state any additional funds. In fact, she
pointed out that there should be savings in year 3 and year
4 when the state began to drop down the revenue
calculation. In year 5, the state would be paying a new
revenue calculation which would be much less that it was
currently. She emphasized that consolidation was voluntary.
The goal was for schools to have 4 years to figure out a
way to repurpose the school. The bill did not address how
to repurpose the school. It was entirely up to the district
and the board to determine each specific property and how
they wanted to handle it. She had found, that for a typical
elementary school in the Anchorage School District the
savings would eventually be about $600,000. She suggested
that if a high school were to theoretically close or be
consolidated, the savings would be about $1 million per
school in the Anchorage School District. The goal was to
use existing infrastructure more efficiently rather than
constructing new buildings.
Mr. King noted that the savings numbers were per school per
year rather than in total.
9:52:24 AM
Mr. King advanced to slide 6: "What the Bill Does: Section
2." He reported that Section 2 provided single school
communities to fully utilize the capacity of the existing
K-12 buildings that they had. There was a provision in
AS 14.17.905 that stated that in communities where there
was a single K-12 school, they would lose funding when
their ADM exceeded 425 students. Currently, under AS
14.17.905, the funding formula for a rural community with 1
K-12 school with 1 to 425 students stated that they would
be treated as if there were 2 schools. In other words, the
number of students, 425, would be divided in 2 to equal 2
schools of about 212 students each. The result would be
that the schools moved up the curve from slide 2 which
provided more funding. When going from 425 students to 426
the school would be treated as 1 school. He suggested that
the movement down the curve from 212 to 426 was a loss of
hundreds of thousands of dollars to that school district,
an unintended consequence of hard coding the 425 number.
Section 2 changed it so that when the schools reached above
425 ADM they would continue to be treated as 2 schools. He
wondered why the state would want to do that. He suggested
that under the current situation, when the student count
went from 425 to 426, all of a sudden, maintaining the K-12
school became less desirable. It also increased the
incentive to build a new school in order to have 2 brick
and mortar schools to maximize funding under the existing
state statute. It was much less expensive for the state to
remove the artificial barrier of 425 students keeping
districts in schools with capacity greater than 25, than it
was to build a new school for tens of millions of dollars.
Senator von Imhof explained that the provision came about
when exploring the legislation for larger school districts.
The particular issue was brought to her attention and was
the reason for Section 2. She noted that it was for
communities with a single K-12 school. It was specific to
the type of school as well as a specific size of the
community. The definition of "Community" was in the bill.
It was for communities that meet the criteria. Currently,
only one community qualified. She did not want the state to
pay for another new school costing tens of millions of
dollars when an existing building had excess capacity and
was working fine for the community.
Mr. King indicated there was another example, but it was up
to the will of the committee if members wanted to see a
more detailed example. Co-Chair Foster thought that the
committee was okay without the more detailed example.
Mr. King offered to walk through the sectional analysis.
Co-Chair Foster encouraged him to do so.
9:57:21 AM
Mr. King read the sectional analysis for SB 216:
Section 1: AS 14.17.410(b)
Adds new language to AS 14.17.410(b)(1) to provide a
"consolidation transition" that allows a school
district to gradually move from their current state
aid amount to a lower state aid amount after
consolidation of schools and describes how and when
the consolidation transition can be used.
(H) Specifies how state aide during the
transition period will be calculated. The "pre-
consolidation" and "post-consolidation" formula
remains the same; the bill will only change how
quickly the "post consolidation" amount is
instituted:
(H)(i)
Consolidation Years 1 & 2: The district will
receive the same funding as if the consolidated
school was still separate schools.
(H)(ii)
Consolidation Year 3: The district will receive
66% of the difference between funding from pre-
consolidation and post-consolidation.
(H)(iii)
Consolidation Year 4: The district will receive
33% of the difference between funding from pre-
consolidation and post-consolidation.
Sections (I) (L) specify conditions where the
"consolidation transition" may not be used.
(I) When the "transitional" state aid amount
would result in lower funding than under the
traditional funding formula.
(J) When a school district is already receiving
additional state aid due to the Hold Harmless
Clause in AS 14.17.410(b)(1)(E).
(K) If a new facility was constructed in order to
consolidate schools.
(L) If the school was reopened and reconsolidated
within the past seven years.
(M) Requires the district to provide the
necessary information and calculations for the
Department of Education and Early Development for
verification, including a student count by school
for the schools involved in the consolidation.
Section 2: AS 14.17.905
Adds a new subsection that allows a school that
services grades K-12 in a single building and has
an average daily membership (ADM) greater than
425 to be considered two separate schools for
calculating state aid.
Section 3: AS 14.17.410(b)
Makes this Act applicable to schools which consolidate
on or after the effective date of this bill.
Section 4: Effective Date
Provides for an immediate effective date.
Mr. King was available for questions.
Co-Chair Foster reviewed the list of available testifiers.
10:01:18 AM
Co-Chair Seaton referred to Section L regarding a school
being reopened and reconsolidated within the past seven
years. He asked if the language meant just under the
proposed program. Mr. King responded only if the school
received the funding transition under the proposed program.
Co-Chair Seaton presented a hypothetical scenario in which
a school was currently closed and was reopened. He though
the school could qualify for the change for reconsolidation
for the following year. Mr. King replied that he was
correct. If there was a school that was currently closed,
reopened, reconsolidated, and closed again, it could
qualify under the section. He had heard from the district
that it took about 2 years to reopen a school and 2 years
to close a school. It was a painful process for districts
and for families involved. Families got very attached to
schools, particularly with schools that had been opened for
a while. Although the bill was creating an additional tool,
it did not mean that consolidation was a done deal. It was
something for districts to consider, but there was a
political process to go through to do so. There would be
significant costs associated with reopening a school. He
thought it was important to consider the pragmatic hurdles.
10:04:13 AM
Co-Chair Seaton asked for a breakdown of cost savings. He
asked for information about the savings associated with the
closing of a school and repurposing it.
Mr. King referred to slide 8 which presented an example of
5 schools shrinking down to 4. The example was of the
Anchorage School District. He noted the district cost
factor in the yellow box of 1.00. In the very lower box, if
the Anchorage School District was to take 5 elementary
schools and consolidate them down to 4, their loss in
funding would be about $800,000. He thought Representative
Seaton was asking what the savings would be to the
districts. He had the information in his office. It showed
that a district would lose a principle, operating costs for
the building, and custodial support staff. The cost savings
would be about $500,000 to $600,000. The district would be
in the hole $200,000 even accounting for closing. He
highlighted the issue of transportation costs. There had
been questions in other committees about having fewer
schools and larger boundary areas resulting in more time on
the bus for students. There was a question about elementary
students spending 40 minutes per day each way on the bus.
The Anchorage School District had testified that it was
committed to making sure kindergarteners were on the bus
for an age appropriate amount of time, which meant adding
additional transportation costs. In this particular
example, based on what was provided to Senator von Imhof's
office, the additional transportation costs would be
$400,000. He conveyed that the school district would be out
at total of $500,000 to $600,000. The Anchorage School
District had been very willing to show its modeling as to
its decision-making process.
Co-Chair Seaton asked Mr. King to provide the information.
Co-Chair Foster asked, "That was who again?"
Mr. King responded that it was the Anchorage School
District. Dr. Bishop, who was online, and her staff would
be able to testify on the issue when they testified.
10:08:40 AM
DR. DEENA BISHOP, ANCHORAGE SCHOOL DISTRICT, ANCHORAGE (via
teleconference), was happy to answer any questions. She had
sent in her written testimony. She indicated that the key
was the operational side. She spoke of Anchorage recently
passing a bond initiative. She was aware that the bond debt
reimbursement program at the state was on hiatus until
2020. She suggested that while the bill was addressing the
operational costs of a school and the movement to close it,
Anchorage had a number of facilities that were built in the
1950s, 1960s, and 1970s. She reported that about 44 to 45
percent of the district's facilities were built prior to
the 1970s. The district was finding buildings that were
used for life and had to put money into them. The district
was happy to put money into them which the community
supported. However, the district wanted to be responsible.
If and when the state bond debt reimbursement came on, the
district would ask the state for support in making its
public schools more efficient.
Dr. Bishop continued with her testimony relaying some of
the questions the district received in prior testimony.
Many questions were about how to gain in the system and
whether school districts would participate. She felt the
district was taking the hard road to be responsive to the
community. People loved their schools. She was aware of how
the city had grown in different areas and where the new
buildout would be. There might be new investment needed in
other areas and some reduction in other parts. Presently,
there was a report about the district being able to find
efficiencies in a couple of schools. The bill would assist
the school district in the type of transition that would be
a 2-year process. The district wanted kids to be able to
matriculate out, while at the same time having high quality
education. The district would never receive more money that
it received presently. In the end, it would always be less.
She reported that it was difficult to convince a community
to do it to itself. She reported that the district had been
modeling the issue out to many schools within the district.
The models found the district with less money in the end.
In terms of the district's accountability and
responsibility to the state about capital, she thought the
district needed to start thinking bigger. Having
acknowledgement through legislation would help to make the
transitions good places to be for teachers, parents, and
students.
10:12:20 AM
Representative Guttenberg asked Dr. Bishop how she
responded to the criticism that the school district had
decided to move to smaller schools because of more money
coming in per student. He indicated she had taken a gamble
that failed. He had heard it was a bail out.
Ms. Bishop responded that she could continue to keep small
schools. She testified that Anchorage's schools were
neighborhood schools. The district had grown substantially.
The district was putting up schools because in the 1970s
and 1980s it was growing so much. Anchorage was larger and
more spread out, but there was not a gamble to build small
schools. They were schools with 400 kids. They were large
schools, as Anchorage was an urban district. The argument
was about making good decisions because enrollment was
declining. She could keep schools at 50 percent capacity
and the funding would continue to come from the state.
However, she did not feel it was right. She was willing to
stand up and say the district believed in education and
wanted education for the twenty-first century. The district
did not want to ask tax payers to put revenue into taking
care of a building the district did not need. She suggested
that the district was looking at sharing resources and
pulling staff together to bring more opportunities to kids.
She was looking at the situation as a cup half full. She
would love to speak to anyone that thought it was a
failure. She argued that if things were left alone the
state would not be keeping account of its own resources.
She relayed that in Anchorage the state was paying 60
percent of the district's bill.
Co-Chair Foster recognized Representative Tilton and
Representative Thompson at the table and Representative
Harriet Drummond in the audience.
10:15:25 AM
Vice-Chair Gara thanked Dr. Bishop for being so vocal on
behalf of Alaska's students. He thought the bill made sense
for the reasons that were stated. However, he wondered how
the legislature could pass a bill which benefited some
school districts but not others. His district would benefit
but, for example, Lake and Peninsula School District would
not. It was not the fault of the bill, as it was trying to
create a problem in the foundation formula. He asked if Dr.
Bishop preferred to have the bill content be part of a
package that perhaps included an increase to the base
student allocation or an upgrade to the pupil
transportation formula. He wondered about the best way to
provide equity to schools across the state and a quality
education. He wondered if it would be better to have it as
part of a package with other things included as well.
Ms. Bishop responded that school districts around the state
would benefit from an education omnibus bill that included
smart thinking about investment in education whether it be
transportation or the BSA. The Anchorage School District
subsidized transportation in the amount of about $2.5
million per year to provide the bussing system in
Anchorage. In addition, looking at investing in education
overall with an increase in the BSA and a full package of
education would be favored. She advocated for a curriculum
bill as well. She did not think the bill did any harm to
districts such as the Lake and Peninsula School District.
She was aware that the Lower Yukon School District favored
the bill. She was happy to have a conversation about
supporting school districts in many different ways.
Vice-Chair Gara thought the points in the bill made sense.
However, even with the bill, unless there were other
changes, Anchorage faced about 100 additional staff losses.
He asked if he was correct.
Ms. Bishop responded that the school district had over 90
reductions in the current year. She elaborated that 50 of
the reductions were certified staff including principle,
teachers, and counselors. She opined that it took more
money to do business in Alaska. She believed the state
should invest in education, as it was the cornerstone of
democracy. She could not speak enough about investment in
education. The operations and the BSA were key paramount
programs.
Vice-Chair Gara agreed that the legislation was a piece of
the puzzle and understood the inequity the bill attempted
to correct. He appreciated Ms. Bishop's testimony.
10:20:29 AM
Representative Pruitt thought the bill was very important.
He asked Ms. Bishop if she expected a savings of about
$647,000 with the reduction of one school.
Ms. Bishop responded, "Absolutely." She indicated the
district had done some scaling out of numbers and
elementary was about a $600 savings in the long run looking
out 5 years. Middle schools ranged between $800 and $1000.
She indicated that the savings was a moving target because
of the ADM and the formula. She suggested that if the
school district was to look at bringing a building offline,
there would be an initial input of funds to be able to move
furniture or repurpose another area. The district would
have to upgrade a space to an acceptable condition for
classroom use. She also mentioned not wanting to give up
long-term maintenance for a school not in use, because it
was still responsible for maintaining the space. In
Anchorage, the school buildings were owned by the city. She
suggested that future bonds might help with re-use. The
school district was also considering moving some of the
charter schools that were renting facilities into other
school facilities not in use. She thought another piece of
legislation offered first use of a facility for another
purpose. The school district was exploring using some of
the facilities for other purposes such as preschools. The
district was looking at how to utilize facilities to
support education in the entire city. She concluded that as
part of a long-term plan, it would be best not to have to
immediately put revenue into a building for capital.
Instead, the district could work out the operational costs
over time. She thought the district would try to provide a
2-year buffer to matriculate kids out of primary,
secondary, and middle school. The district would want to
work with the city, parents, teachers, and students on the
issue. She believed the district could find savings in the
long-term. The school district's model was built off of a
long-term plan.
Co-Chair Foster indicated that floor session would begin
momentarily. The committee would resume later in the day.
He recessed the meeting to a call of the chair.
10:25:10 AM
RECESSED
1:36:37 PM
RECONVENED
Representative Grenn stated there had been spurts of
building elementary schools. He asked when the last batch
had been built. Ms. Bishop answered it had been over 10
years.
Co-Chair Foster OPENED public testimony.
DR. LISA PARADY, EXECUTIVE DIRECTOR, ALASKA COUNCIL OF
SCHOOL ADMINISTRATORS, spoke in support of the bill. She
relayed that although the bill impacted the Anchorage
School District and the Lower Yukon School District, there
were potentially other school districts that would use the
legislation as a tool and had indicated interest. The
reason her entity supported the bill was because it was
voluntary. She appreciated Dr. Bishop and Dr. Picou looking
at efficiencies in their districts and what they need to be
doing to support their local communities. She hoped the
committee would consider the bill as another flexibility
tool to provide for school districts if they deemed it
necessary for their communities.
Vice-Chair Gara thanked Dr. Parady for her work in
education. Since she represented many different officials
across the state and because she was testifying on behalf
of the bill, he assumed that the officials from areas that
would not benefit from the bill believed in lifting other
boats up. He asked if he was correct.
Ms. Parady replied that across the state the council
recognized that each district was doing whatever possible
to look at their efficiencies and what they needed to do in
support of their students. There was a general amount of
support for school districts across the state. The
districts were supportive of doing what was best for their
local communities. The recognition of local control, which
was held dearly, was true with the current legislation. If
the bill was mandatory she would feel differently. She
continued that the fact that the bill benefited the
Anchorage School District and potentially other districts
and did not cause harm to other districts, the districts
supported each other. She added that the bill had been well
thought out by the districts seeking the bill.
1:42:29 PM
Representative Guttenberg asked about what a school
district could do in a situation where inefficiency existed
for a long time and where reorganization into a
consolidation program should be applied. He did not believe
the state had any tools to address a situation where even
though a school fell below a certain level or a certain
attendance record, it was still more cost effective to
remain as-is, even with inefficiencies. Ms. Parady would
have to think about the response; she was not prepared to
make a recommendation presently.
Co-Chair Seaton was concerned about unintended consequences
or uses. He had mentioned subsection l under Section 1 of
the bill. The section indicated that if the school was
reopened and reconsolidated in the previous 7 years, it
would not be able to use the tool. He wondered if any flex
schools or magnet schools had closed, reopened, and
reconsolidated. He asked if Ms. Parady was aware of any
circumstances where his example would be the case. The last
thing he wanted to do was create legislation in which
people could take advantage of a system for something other
than what it was intended.
Ms. Parady thanked Co-Chair Seaton for considering
unintended consequences. She was not aware of any
unintended consequences with SB 216. She believed Mr. King,
in his work with the districts, had considered the
different consequences. She reiterated that the safeguard
was that the bill was voluntary. She added that regarding
subsection L, she was not aware of any specific situation
that currently applied. She offered to follow-up.
Co-Chair Seaton appreciated Ms. Parady following-up with an
answer to his question. He wanted the intent of the bill to
be clearly stated. He was not opposed to tweaking the
language of the bill to ensure it was as clean and
effective as possible.
1:47:27 PM
Representative Ortiz asked if there was any potential
impact particularly in rural areas where school choice
issues were a concern. He asked if the bill had been vetted
by members of the association and whether they had
expressed any concerns. Ms. Parady replied that she was not
sure there would be the capacity to use the bill in rural
areas. She was unaware of any situations that would impact
the rural areas. In meetings with superintendents recently,
she reviewed the bills that were moving in the legislative
session and did not hear any concerns expressed about the
bill. She reiterated that Dr. Bishop had done considerable
work and had a very good understanding of her district. She
had advocated that for the Anchorage School District, the
legislation was appropriate. There were other districts
that saw the legislation as a potential tool but would not
be mandated. Currently, the bill would support a couple of
the school districts represented by the council. There were
also other districts that thought the bill provided a new
tool. She did not see any negative impact to rural Alaska.
The bill was a flexible tool. The school districts needed
many tools.
Representative Kawasaki spoke about a decline in school
enrollment in Fairbanks in recent years. The city was now
expecting a ramp up in enrollment. He asked if there had
been consideration of the cyclical nature of enrollment.
Ms. Parady deferred to Dr. Karen Gaborik regarding
Representative Kawasaki's question about Fairbanks and
rolling enrollment. She also deferred to Mr. King on
specifics.
Mr. King replied that the school districts had to be
looking forward. In the case of the Anchorage School
District and the Mat-Su School District, they conducted
forward-looking projections of their expected enrollment.
Kids did not show up instantaneously. They had to be born
first. The state had birth records and records of Permanent
Fund Dividend (PFD) enrollments. The state could see what
was coming. He noted that twice per year the Anchorage
School District looked ahead 6 years. He relayed that the
professionals managing the systems were aware of the
issues. He reiterated that it took 2 years to open a school
and 2 years to close a school. He believed long-range
thinking was required and reminded members that districts
had to go through a public process. He thought it wise for
a school district to consult with its citizens. The process
lent itself to long-range thinking. The bill contained
provisions that did not allow a school to reopen and
reconsolidate a school earlier than 7 years. However, a
significant portion of the timeframe was just what was
needed to start the planning. He did not think the
districts would be switching schools on and off like a
light because of the tool provided in the bill.
1:53:50 PM
Representative Guttenberg provided an example, Rampart
School. Rampart, Alaska was forced to close their school
because of going below the student minimum. Young
leadership came in and brought people back. They reopened
the school and the community was vibrant again. He wondered
if there were traditional dollars available for shutting
down and then reopening again. He asked how it worked in a
case such as his example.
HEIDI TESHNER, DIRECTOR OF SCHOOL FINANCE, DEPARTMENT OF
EDUCATION AND EARLY DEVELOPMENT, reiterated Representative
Guttenberg's question that if Rampart was closed and then
reopened because they had enough students, would they come
to the department requesting permission to reopen and have
it counted on the attendance list in October. A minimum of
10 students would be required to open the school.
Representative Guttenberg asked if transitional support was
available after shutting down a school then reopening it.
He relayed a number of things were needed to reopen a
school. He asked if transitional funds were available
following a forced shutdown in order to reopen. Ms. Teshner
replied that typically the school district would go through
a process of determining whether to reopen a school. They
would go through the process of finding funding and hiring
teachers. The state did not have anything in the way of
statutes or the transitional funding. They would have to
find money through revenues.
Representative Guttenberg surmised that there was no
support. One day they were open and one day they were
closed. Ms. Teshner answered in the affirmative.
Co-Chair Seaton acknowledged Representative Gary Knopp in
the audience.
Vice-Chair Gara stated there was a four-year step down. If
a district consolidated a school, it might suffer a penalty
by receiving less funding under the foundation formula. He
understood the committee was trying to resolve the loss of
funds for some of the school districts, He did not believe
the 4-year step down magically indicated the school would
find the exact amount of efficiencies to make up for the
loss. He thought that at worst, it was a way for schools to
figure out how to adjust their finances over the 4-year
timeframe. It was unclear how much efficiency would be made
up in 4 years. At worst, it was a way for schools to figure
out how to adjust their finances: At best, they would find
efficiencies. He was not sure the district would be able to
find the exact amount of efficiencies in 4 years with a
step down. He asked if he understood correctly. Mr. King
replied in the affirmative. There was nothing to say that 4
years was the perfect number. He had not heard any negative
testimony about a 4-year period. It seemed like 4 years was
a reasonable number. It was another tool in the tool box.
The bill was voluntary and gave districts the opportunity
to go through the process as they saw fit. Vice-Chair Gara
thought it would be impossible to hold someone to modeling
more precisely.
1:59:09 PM
ANDREW LEAVITT, LOWER YUKON SCHOOL DISTRICT, MOUNTAIN
VILLAGE (via teleconference), read a letter from the school
superintendent:
Dear Senate Education Committee Members,
I have been a teacher, a principal, and a
superintendent in both rural and urban Alaska for the
past twenty years. On behalf of the Regional School
Board, the families of the Lower Yukon School
District, and the staff of the Lower Yukon School
District, this testimony is in support of Senate Bill
216: SCHOOL FUNDING FOR CONSOLIDATED SCHOOLS.
We are in support of Senate Bill 216 for the following
reasons:
1. Hooper Bay is a growing community with a
population of 1275. The Hooper Bay School is the
largest school in LYSD. The current enrollment is
at 449, well beyond the 425 specified in AS
14.17.905.
2. Every school in Alaska is funded proportionately
according to its ADM during a twenty-day count
period. According to the current language of AS
14.17.905, Hooper Bay School is the only school
in Alaska that actually gets penalized for an
increase in student enrollment.
3. In current form, the provision in AS14.17.905
that calculates funding for a school with an ADM
over 425 as one school instead of two schools
would equate to a reduction in revenue of $1 M. A
reduction in school funding of this size would
have a very detrimental impact on children in the
Lower Yukon School District.
4. The Senate Bill 216 provision correction of AS
14.17.905 in Sec 2 would hold the children of
LYSD harmless from the unintended consequences of
legislation that was written in 2001. In the
original language of AS 14.17.905, this
unintended consequence was anticipated, and
Hooper Bay was specifically mentioned in
deliberation.
For these reasons and many more the Lower Yukon School
District supports Senate Bill 216 and thanks you for
elevating the unintended consequences of AS 14.17.905
that would have the delirious impact on the quality of
education offered to the children of the Lower Yukon
School District.
Sincerely,
Dr. Rob Picou
Co-Chair Foster asked Mr. Leavitt to pass on regards to Dr.
Picou. He was aware the doctor had been online earlier in
the day.
2:01:49 PM
AT EASE
2:02:04 PM
RECONVENED
REPRESENTATIVE HARRIETT DRUMMOND, CHAIR, HOUSE EDUCATION
COMMITTEE (via teleconference), relayed that the House
Education Committee passed the House companion bill HB 406
sometime previously. She thought some of the questions
posed in the meeting had been interesting. She spoke about
her past experience as a school board member. She relayed
that in the nine-year period she served on the board the
Anchorage School District's population grew from 40,000
students to about 50,000 students. In that 9-year period,
the Anchorage School District built nearly $500 million
worth of school buildings including new school buildings,
expansions, renovations, and additions.
Representative Drummond reported that she participated as a
school Board Member in 2 district-wide boundary changes;
the middle schools and the high schools. It had been one of
the most tumultuous periods for the Anchorage School
District. The district built 2 new middle schools, Mirror
Lake Middle School and Goldenview Middle School, with a
bond issue that passed in 1994. The boundary change for
middle schools was not as difficult because some of the
middle schoolers had new schools to go to. However, the
high school boundaries had to change because many of them
were overcrowded and some had space. The district had not
built new high schools in the 9-year period. The process
was terrible because the district was moving kids around to
even out the population between schools. She expressed
sympathy for Dr. Bishop in having to make similar
transitions like the proposed consolidation of 5 elementary
schools to 4. Often parents purchased their homes to be
close to a particular school. It was difficult for the
district to have to tell those parents that it was going to
close that school and their children would have to get on a
bus to go to school a couple of neighborhoods away. She
opined that it was disconcerting and a problem in
communities. She understood Dr. Bishop's wish to take the
transition slowly.
Representative Drummond continued to elaborate that
teachers traveled with their students. The school's
administration positions went away once the transition
process of a consolidation was complete. She noted that the
Anchorage School District had the largest square footage of
real estate in the state of any single institution. There
were over 90 schools and several facilities and support.
She advised proceeding very carefully with seeking to make
large changes.
JIM ANDERSON, CHIEF FINANCIAL OFFICER, ANCHORAGE SCHOOL
DISTRICT, ANCHORAGE (via teleconference), clarified areas
of concern that had been expressed. There was a perception
that Anchorage had done some poor planning in the past and
was the reason the district was looking at consolidating
schools. However, it had more to do with changing
demographics and a declining student population. Anchorage
had lost more than 2,200 students. The schools were
originally built based on the population needs at the time.
The district had not opened up a new elementary school in
about 20 years or a new high school in about 10 years. He
also noted the topic of whether Anchorage would attempt to
close a school, open it back up in 2 years, close it, and
reopen it in 2 years. He conveyed that the amount of time,
effort, and energy to get ready to close a school was
incredibly time consuming. He could not imagine a scenario
where it would occur.
2:07:42 PM
Co-Chair Foster CLOSED public testimony.
CSSB 216(FIN) was HEARD and HELD in committee for further
consideration.